“Is Bitcoin anonymous?” Here’s a hint 🙅‍♂️

CoinCorner
Dec 7, 2020 · 2 min read

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So, when people ask if Bitcoin’s anonymous, they really mean “can I send Bitcoin anonymously?” and the simple answer is no.

Why isn’t it anonymous?

Historically, Bitcoin was misunderstood by some as being anonymous.

Over time, this belief became a common misconception and is still something that confuses new Bitcoiners today.

The reality is that Bitcoin is actually pseudonymous. All transactions are stored on the public blockchain and any payment can be traced back.

For example, when you send Bitcoin to a friend, you’ll see that your wallet address doesn’t identify your name as it would if you sent the transaction through your bank.

Although it’s made up of a random/unique combination of numbers, the address itself can be traced back to reveal your personal information.

Famous mistakes

Many people have been caught out by wrongly thinking that Bitcoin is anonymous.

Earlier this year, Twitter was hacked and a Bitcoin scam collected around $110,000 via posts from compromised high-profile accounts. The 3 culprits were caught because they attempted to cash out the stolen funds through accounts made on Coinbase — an exchange that held their personal information.

In 2013, the FBI shut down an online black market called Silk Road. One of the agents involved in the case, Shaun Bridges, stole Bitcoin funds — around $820,000 — as it was being recovered from the marketplace. He moved the the Bitcoin to another exchange and it was the discovery of this account which eventually led the FBI to him.

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